MHI Enforces 100% Domestic Sourcing for 18 Critical EV Components Under PM e-Drive Initiative – EQ
In Short : The Ministry of Heavy Industries (MHI) has mandated a 100% Domestic Content Requirement (DCR) for 18 critical EV components under the PM e-Drive initiative. This policy aims to boost local manufacturing, reduce import dependency, and strengthen India’s EV supply chain. It aligns with the PLI scheme for ACC and auto sectors, promoting self-reliance and supporting the growth of the domestic EV industry.
In Detail : The Ministry of Heavy Industries (MHI) has introduced a significant policy requiring a 100% Domestic Content Requirement (DCR) for 18 critical components used in electric vehicles (EVs). This mandate is part of the PM e-Drive initiative, which falls under the broader Production-Linked Incentive (PLI) scheme for Advanced Chemistry Cells (ACC) and the auto sector. The move aims to strengthen India’s EV manufacturing ecosystem and reduce reliance on imports.
By enforcing 100% DCR, the government is pushing for greater localization of EV production. The 18 components include essential parts such as electric motors, controllers, and power electronics, which are crucial for the functioning of EVs. This policy is expected to encourage domestic manufacturers to invest in research, development, and production of these components, fostering innovation and self-reliance in the EV sector.
The mandate aligns with India’s broader goals of achieving energy security and reducing carbon emissions. By promoting the use of locally manufactured components, the policy supports the growth of the domestic EV industry, making it more competitive globally. It also aims to create jobs and boost economic growth by encouraging investments in the manufacturing sector.
The PLI scheme for ACC and the auto sector, under which this mandate falls, is designed to incentivize the production of advanced technology products in India. By linking incentives to domestic content requirements, the government ensures that the benefits of the scheme are channeled toward building a robust indigenous supply chain. This is expected to attract both domestic and foreign investments in the EV component manufacturing space.
The 100% DCR requirement is also expected to address challenges related to supply chain disruptions, which have been a concern for the global automotive industry. By localizing the production of critical components, India can reduce its dependence on imports and enhance the resilience of its EV supply chain. This is particularly important as the country aims to become a global hub for EV manufacturing.
Overall, the MHI’s mandate is a strategic step toward achieving Atmanirbhar Bharat (Self-Reliant India) in the EV sector. It not only supports the growth of domestic manufacturing but also aligns with India’s commitment to sustainable mobility and reducing its carbon footprint. This policy is expected to play a pivotal role in accelerating the adoption of EVs and strengthening India’s position in the global automotive market.
